How to Stop Wasting Money on Revenge

With the endless prospect of a looming recession , it seems like the only true certainty is that we all need to come to terms with life under uncertainty. But uncertainty breeds anxiety. At the start of the pandemic, many of us responded to our fears by cutting spending. But over time, this restrictive behavior may have swung too far in the other direction, leading to what is called “revenge spending.” If you’ve let your coping expenses go over the top since lockdown ended, here’s what you can do to get your habits back on track.

What is “revenge costs”?

As the name suggests, revenge spending occurs when you scatter your money around to “come back” after a period of financial hardship – whether it’s being fired from your job or a global pandemic. As the New York Times explains, this spending behavior can be seen as a response to scarcity thinking: you suddenly spend more money to make up for lost time. It doesn’t sound rational, because it isn’t. It’s like overeating following a restrictive diet, and you soon find yourself trapped in a cycle of behavioral extremes.

How to stop wasting money on revenge

If you have any problems with spending and saving, you need to create a budget – something like the 50/15/5 rule is a great start. Of course, this is easier said than done, especially when an emotional issue is at the heart of your spending. Here are some more specific tips to help you stick to your spending budget.

Try the mincemeat

As we have said before , and as you have probably noticed in your life, touching money and giving it away can actually hurt on an emotional level. So, if you need a mental boost to stick to your budget, physically confronting an empty envelope is much more powerful than checking your bank account online.

This is where filling with money comes in handy. Label different physical envelopes and fill them with cash for various expenses. Fill each envelope with the planned amount of cash for that month (or billing period). The bottom line is that you can only spend money in a certain category of cash in a specified envelope – as soon as the envelope is empty, it will be a month.

Filling with cash works because it forces you to be more deliberate (deciding how much money goes into your envelopes) and more disciplined (you can’t put more money in an envelope when it runs out).

Stick to the “what to buy” list

Another place to start with your specific spending goals is to physically write down the things you want to buy before you buy them . Use these bank statements to tell you what items are on your official “shopping list”. When you read the items on this list, you will be able to make a more informed decision about what you really need.

You are still allowed to heal yourself

Remember too many restrictions is what led to your revenge spending problem in the first place. Forming a healthy money relationship means indulging thoughtfully . Ask yourself: “How do I expect this purchase to make me feel? What do I want it to make me feel? What feelings am I trying to avoid by buying it?

Only you can determine what’s truly valuable in your life, whether it’s the occasional latte from your local coffee shop or the yearly savings for a luxury vacation. Allow yourself to be pampered, especially if these indulgences improve your overall relationship with money.

To learn more, find out how you can curb unconscious spending here .